I asked the owner of a Benetton store if he thought ‘Brand loyalty’ existed or not? To my surprise he said that most of the youth coming to his store are his loyal customers who shop with them almost every week! On the other hand I have friends who have half of their wardrobes full of clothes of one particular brand. And when I asked why it was that way, they simply said ‘Brand loyalty’. But does it really exist in today’s world of ample choices? Let’s find out...
What it means?
Brand loyalty refers to a situation where a shopper has the tendency to make repeat purchases with the same brand. Such a situation is beneficial for a brand as it helps in retaining the customers and effectively works towards serving them. It is said that 80 per cent of the business for a brand comes from 20 per cent of its loyal customers. These customers are those who spend great sum of their total expenditure at one store as compared to any other store. Research has shown that greater the equivalence between Self Image and Store Image, higher is the likelihood that the customer is loyal.
Is brand loyalty fading these days?
In a situation of intense competition, it is quintessential to be able to retail your loyal customers to stay ahead of competition. When thinking of brand loyalty, the question that came to my mind was what if a better option is available at the same or a better price? Would there be a shift in preference for the other brand? When I asked the same question from Gauri, a brand loyalist of brand XYZ, she replied, “If I get a better cut, fit and design on a lower price, of course I would go for another brand.” A couple others when asked the same question said they would shift even though maximum clothes they owned were from their favourite brand while just a negligible few rebuffed the offer. So making them feel special will for sure work in your favour.
How to Retain loyal customers?
Loyalty erodes very fast when the shopper is confronted with competitiveness, promotions and deals. It has become a very difficult task to retain a customer for a brand, which is the primary reason for fading brand loyalty. Here are a few significant factors you must consider to maintain your customer base.
Coping with variations in price
Offering what your customer wants at a price which is best suited to them is what you need to look at. Customers in India are very price sensitive and catering to this need while offering the best to them is what a retailer must strive for.
Giving them loyalty cards that offer them some preference over other customers can be one thing that will bring them back to your store.
Loyal customer service
Adding a personal touch to customer service when they are in your store by showing them around for merchandise that you know would suit their taste and inclination also helps.
Special discounts and offers
Keeping them updated with store happenings, sales, discounts and offers will always lure them to the store. Offering them an additional discount can also swing their vote in your kitty. Such shoppers are far more forgiving for errors at their favourite store when comparing it to another but that does not give you the liberty to be laid back in your approach towards them.
So we can say that the concept of store loyalty does exist. However it is up to retailers as to how much effort they can make to retail their ‘brand loyal’ customers. If the effort is made, it will bring an edge of difference to them.